121.In terms of
individual nations, the largest U.S. trade deficit is with:
A. Japan.
B. Mexico.
C. China.
D. Canada.
122.The world’s
largest debtor nation in terms of debt owed to foreign citizens and governments
is:
A. Russia.
B. Argentina.
C. Japan.
D. The
United States.
123.The United
States’ current account deficit reached a new high in:
A. 2006.
B. 2007.
C. 2008.
D. 2009.
124.The large
trade deficit that the U.S. has with China persists in part because:
A. the
U.S. economy has grown slowly in recent years.
B. China
has fixed its exchange rate and not allowed the yuan to appreciate relative to
the U.S. dollar.
C. China
has experienced rapid economic growth over the past decade.
D. China
has recently imposed or increased tariffs on most goods imported from the U.S.
125.Which of
the following has contributed to large U.S. trade deficits in recent years?
A. China
fixing its exchange rate.
B. Rapid
decreases in the price of oil that have triggered dramatic increases in oil
imports.
C. A
rising U.S. saving rate.
D. All
of these have contributed.
126.Present
consumption supported by large trade deficits may come at the expense of:
A. permanent
debt to foreign interests.
B. permanent
foreign ownership of formerly U.S. owned assets.
C. large
sacrifices of future consumption.
D. all
of these.
127.(Last Word)
People who buy foreign currency for the sole goal of selling it at a profit are
called:
A. numismatics.
B. currency
hedgers.
C. currency
manipulators.
D. currency
speculators.
128.(Last
Word) Currency speculators aid international trade by:
A. absorbing
exchange rate risk that others do not want to bear.
B. increasing
the volatility of exchange rates.
C. making
the demand for imports less elastic.
D. promoting
barter.
129.(Last Word)
Firms engaged in international trade can reduce exchange-rate risk by:
A. paying
for foreign goods only when they are delivered.
B. buying
on credit.
C. hedging
in the futures market.
D. dealing
only with highly reputable firms.
130.U.S. exports increase and U.S. imports
decrease the supplies of foreign monies owned by U.S. banks. True False
131.Under freely flexible (floating) exchange
rates, if the dollar price of pounds rises, the pound price of dollars will
fall.
True False
132.If the price of British pounds, measured in
terms of U.S. dollars, is rising, then the price of U.S. dollars, measured in
terms of British pounds, is also rising.
True False
133.Under freely flexible (floating) exchange
rates a U.S. trade deficit with Japan will eventually cause the dollar price of
yen to rise.
True False
134.If the dollar depreciates, U.S. exports will
eventually rise and U.S. imports will eventually fall. True False
135.A system of fixed exchange rates is more
likely to result in exchange controls than is a system of flexible (floating)
exchange rates.
True False
136.A nation that imports more goods and services
than it exports is necessarily realizing an international balance of payments
deficit.
True False
Answer
the question on the basis of the following 2008 balance of payments statement
for Transylvania. All figures are in billions of dollars.
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137.Refer to the above data. In 2008, Transylvania
imported more products than it exported. True False
138.Refer to the above data. Transylvania had a $2
billion balance of trade (goods) surplus in 2008. True False
139.Refer to the above data. In 2008 Transylvania
realized a $1 billion surplus on goods and services. True False
140.Refer to the above data. In 2008 Transylvania
was a net recipient of transfers from the rest of the world.
True False